RBL Bank Shares Downgraded To 'Sell' By Dolat Capital Post Q1 Results On Expensive Valuations

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Dolat Capital Report

RBL Bank Ltd. has gradually, but consistently improved share of granular retail deposits and is reducing share of unsecured micro finance /constant currency loans. However, this has impacted NIM and fee lines, which are settling at lower levels.

Moreover, while secured book is growing at a strong pace, recent delinquencies are on the rise and remains a monitorable. Management is not concerned over secured delinquencies at this point.

With 27% loan mix towards unsecured retail, FY26E RoAs at <1% is non commensurate with portfolio risks.

We revise our rating downward to ‘Sell’ owing to stretched valuations at 0.9x FY27E.

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